GE bets big on new Industrial Internet software business

General Electric Co. last month debuted the first mass advertising for its new Industrial Internet software business, a major initiative that Chairman-CEO Jeff Immelt launched late last year. Since that time, GE has been hiring hundreds of people and working with cross-functional teams across the company to develop the business.
“The Industrial Internet is an open, global network that connects people, data and machines,” Immelt said in November in a speech at GE's Mind+Machines 2012 conference where he announced the new business. “Industrial companies are going to seek to interface, access and really develop the analytical layer and the software layer around their products.”
Immelt said GE's Industrial Internet will combine software, hardware and analytics to improve productivity in healthcare, energy, transportation and other industries the company now serves.
GE will spend more than $1 billion on a new software development center in San Ramon, Calif., over the next three years to produce technology for Industrial Internet; so far, it has hired more than 400 software engineers, marketers and salespeople for the new business.
“We are bringing together the worlds of software, data and analytics with the industrial sector,” John Magee, who joined GE in January 2012 as CMO-GE Software, said in a recent interview with BtoB.
“The Internet has greatly impacted the way we buy music and interact with vendors online; we see the same potential in the businesses GE serves—remaking industrial sectors. We believe it will remake business models and bridge the worlds of technology and industry.”
GE rolled out its first TV commercial for Industrial Internet last month. The spot, called “Brilliant Machines,” was created by BBDO New York and features the character of Agent Smith from the movie “The Matrix” played by Australian actor Hugo Weaving.
In the spot, Agent Smith replicates himself in a hospital to show the different ways GE is improving healthcare with technology. “GE has wired their medical hardware with innovative software to be in many places at the same time,” the character says.
While healthcare is the first business to be featured in Industrial Internet advertising, other GE businesses such as energy and jet engines are also part of the effort, said Steve Liguori, executive director-global innovation and new models at GE.
The marketing side of the software business reports to Liguori, who is part of GE's corporate marketing team, led by CMO Beth Comstock.
“We partner with all GE businesses to develop products coming out of each vertical,” Liguori said. “Everybody is accountable; everyone has a role. The skills to build a jet engine and market a jet engine are decades old, but when you start putting software on top and integrating data, that's a whole new world.”
As an example of how the new software business is integrated with other GE businesses, Liguori pointed to the company's jet engine unit. In fact, GE had an actual jet engine (weighing more than 10 tons) on stage at the Minds+Machines conference in San Francisco.
“We are developing software based on smart sensors that are embedded in the engines and generate a couple of terabytes of data on every flight,” Liguori said. “The data are used to optimize the performance of the aircraft and the ways in which the jet engine is serviced, which can save billions of dollars a year for the aviation industry.”
GE will roll out more advertising later this year for other Industrial Internet applications. It is also making heavy use of social media and online to promote the effort.
In November, GE introduced an online contest, called Flight Quest, to a target audience of aviation engineers and operations professionals to show how data can be used to improve productivity in the industry. Users downloaded actual data from flights and were asked to create algorithms to make the flight more efficient. GE gave away $250,000 in prizes as part of the contest, including $100,000 to the winner.
GE rolled out another contest, called Hospital Quest, in which hospital administrators and technology professionals were challenged to create a more efficient patient experience. GE gave away a total of $100,000 in prizes in that contest.
Results from both contests are available at www.gequest.com, and a second round of contests will be rolled out June 30.
“The idea of crowdsourcing is part of this new strategy,” Liguori said. “These were very specific technology challenges we knew the industry needed to solve. We are making available huge amounts of actual industry data.”